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 Patent News |
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| Subject : Patent Wars Heating Up |
| Date |
2009-12-30 |
Visit |
4325 |
South Korea's leading electronics players are beefing up their defense against patent abuse by introducing new measures to protect their technology and reputations.
Samsung Electronics, the leader in the chip and flat-screen industries, has increased the number of its staff specializing in patent issues by 300 to 550 since 2005, according to company representatives.
It says patent-related issues have emerged as one of the company's top concerns in the face of intensified competition among rivals in the consumer electronics industry.
A growing number of patent trolls is another problem.
These individuals or companies enforce patents as an investment to collect royalties, rather than manufacture products or delivering services based on them.
LG Electronics is planning to increase the number of its patent staff by a "certain percentage" in 2010, while LG Display, the world's No. 2 maker of LCD panels, is also reviewing the possibility of expanding its legal affairs capability, according to industry sources.
"It's necessary for LG to constantly expand the number of patent staff to reinforce the negotiation power in international patent lawsuits," an LG representative said.
Samsung Electronics has been involved in a years-long patent war with Rambus in chips. At the same time, the company has been tied up in a patent litigation with Japan's Sharp in flat-screens and Finland's Nokia in mobile phones.
"Samsung and Sharp have many patents related to LCD technology so these kinds of lawsuits will continue to occur as long as they make TVs," said Kim Yoo-jin, an analyst at Taurus Investment & Securities.
The situation is no different for LG Electronics and LG Display.
LG Group's two key units have been linked with several patent-related problems with their bigger overseas competitors.
Nokia has filed a suit against LG Display, alleging collusion to fix the price of the LCD panels that it uses in its mobile phones.
Legal proceedings for establishing patent infringements are complex and time-consuming. Nonetheless litigation has become common to settle infringement allegations, analysts say.
"A counter-legal action is necessary as companies are hoping to preserve their brand integrity and to maintain brand recognition," Kim Gee-soo, an analyst at Shinhan Investment, said.
"But it is strongly necessary to enforce patent-related capabilities. The majority of South Korean companies are still vulnerable to patent rights disputes," he added.
The Federation of Korean Industries (FKI), a lobby group of the nation's biggest businesses, said 70 percent of the 30 companies surveyed expected to receive claims by patent trolls in the near future, with 20 percent saying they have already been sued or are expecting imminent action.
"While past disputes were concentrated against local information technology companies, patent trolls have started to expand their operations into the auto trade, ship building and steel, and could spread to the energy and bio-tech areas in the future," the FKI said.
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